RP seeks $ 250M loan from WB

MANILA, May 16 — The Philippine government is seeking for a supplemental loan to finance social and infrastructure projects due to the recent typhoons.

The World Bank said the country is asking Supplemental Financing to the Food Crisis Response Development Policy Operation amounting to $ 250 million.

In 2008, the Philippine government has obtained a $ 200-million loan from the World Bank to fund the country’s food-crisis program.

The World Bank said the additional financing aims to help finance part of the gap which results from recent typhoons to cushion the social and economic impacts.

The lender added that the additional loan to provide incremental financing, both to address revenue losses resulting from the recent disaster as well as to finance previously unbudgeted reconstruction expenditure which result from recent typhoons.

It also aims to protect existing government programs, which include the social programs supported by the original Food Crisis Response Development Policy Operation, from any effects of the fiscal shock due to the disaster.

"The supplemental lending will have significant beneficial impacts on poverty and social condition of the typhoon-affected population to the extent that the government implements a reconstruction plan which accelerates the recovery of these communities and households," the World Bank said.

The lender said the loan is expected to approve this month.

The World Bank's Post Disaster Needs Assessment (PDNA) estimates that of the total estimated recovery and reconstruction needs over the next years of $ 4.42 billion, as much as 55 percent may need to be financed from the public sector.

The PDNA also said the number of poor people in the Philippines is estimated to increase by 480,000 in 2009 as a result of the losses in incomes due to lower economic activities.

Also, the disaster was estimated to have increased the poverty incidence by 0.5 percentage points. (PNA)

LDV/DGA/rsm

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